Embattled Illinois Senate candidate Alexi Giannoulias continues to take fire for his questionable business ethics – this time for doing business with a French bank known for financing the Iranian energy secter.

The Weekly Standard today ran a piece, saying that Giannoulias’ dealings with the French investment bank Natixis were “disturbing”.  This comes on the heels of revelations about his role in funding convicted organized crime figures through his family owned Broadway Bank, and the arrest of one of Giannoulias’ top donors for fraud as he tried to flee the country.

From The Weekly Standard:

Alexi Giannoulias is no stranger to controversial business relationships: As chief loan officer at his family’s Broadway Bank, the Illinois Democrat running for President Obama’s old U.S. Senate seat authorized loans to convicted organized crime leaders like Michael “Jaws” Giorango (a pimp and bookmaker) and Demitri Stavropoulos (an illegal gambling operator). Giannoulias also serviced loans for convicted felon Tony Rezko.

And, just last week, a Chicago businessman who contributed $115,000 to Giannoulias’s campaign and received millions in loans from Broadway Bank was arrested on bank fraud charges as he attempted to flee the country.

Giannoulias, currently the state treasurer of Illinois, has some disturbing, if indirect, business connections to Iran.

Although several legislative efforts in Congress are currently in the works to apply more sanctions to Iran, and although Giannoulias has called Iran “the greatest single threat to peace in the Middle East,” when it comes to his personal finances, however, Giannoulias does not apply the same standards.

Giannoulias owns stock in his family’s Giannoulias Enterprises, a limited partnership that owns several properties in Chicago.  Giannoulias’s brother, Demetris, serves as the president.

In April 2007, Giannoulias Enterprises refinanced its real estate portfolio, taking out a $21.5 million, 10-year loan on six properties – four of them being the locations of the family’s Broadway Bank. With all the banks in the world to choose from, Giannoulias Enterprises selected the French investment bank Natixis – an institution with a long and public history of doing business in Iran.

Embattled Illinois Democrat Senate hopeful Alexi Giannoulias got some bitterly bad news today, as he learned that Nick Giannis, the owner of the Boston Blackie’s restaurant chain and a big financial supporter of his political career, was hit with bank fraud charges.

The Chicago Sun-Times explains:

“The owner of the Boston Blackie’s restaurant chain — a man with strong political ties to U.S. Senate candidate Alexi Giannoulias — was charged today with bank fraud, along with the owner’s son and an employee.

Boston Blackie’s owner Nick Giannis, 62, his son, Chris Giannis, 38, and Boston Blackie’s manager Andy Bakopoulos, 38, allegedly defrauded Charter One and Washington Mutual banks of nearly $2 million, Cook County prosecutors said.

Giannoulias’ family owns Broadway Bank, one of the banks named in the court documents. The bank was not a victim of the alleged scheme, officials said.

Nick Giannis was caught at the Canadian border with his Greek passport this morning.

He and the younger men used other Chicago area banks — including Giannoulias’ family’s Broadway Bank — to carry out their “sophisticated, complex” check-kiting scheme, Cook County State’s Attorney Anita Alvarez said.

When pressed about whether Broadway Bank officials knew about the alleged scheme, Alvarez simply said, “These are the three we feel are responsible for this particular case.”

Giannis contributed $115,000 to Citizens for Giannoulias between 2005 and 2008 alone and secured millions of dollars in mortgages with Broadway Bank, records show.

A spokeswoman for Giannoulias said today that the Senate candidate and Giannis aren’t related. Sources said Giannoulias and one of Giannis’ sons are longtime friends.

Broadway Bank has been a political albatross for Giannoulias, who is now the Illinois state treasurer. Giannoulias was the bank’s chief lending officer for several years. He has acknowledged the bank is in danger of failing before the November election.

Boston Blackie’s, which has eight locations in the Chicago area, had filed for Chapter 11 bankruptcy protection in November of last year.

Alvarez said her office began investigating the scheme in early 2009 after authorities were tipped off.

After a day of meeting with editorial boards at the Chicago Sun-Times and the Chicagao Tribune Giannoulias fails to end questions about his controversal role with his families bank.

The Sun-Times writes: [I]f Giannoulias’ intent was to clear the air, we’re still seeing smog. And to the extent that we do see things more clearly, we’re not sure he’s looking much better.

Valid questions remain about whether Broadway Bank, before and after Giannoulias worked there, took imprudently high risks with both deposits and loans. And a certain vagueness remains as to why the family withdrew tens of millions of dollars in dividends in 2007 and 2008.

And the Tribune says: He did address the issues. But he didn’t exactly put them to rest. He failed.

The Chicago Sun-Times writes: State Treasurer Alexi Giannoulias acknowledged Wednesday that his family bank, the Broadway Bank, will probably fail.

As the Illinois Senate race heats up and questions continue to swirl around Alexi Giannoulias and his family bank, the Democrat Senate hopeful would like voters to believe that the economy brought down Broadway Bank. But a quick look at the facts shows Alexi’s risky lending was the cause:

• Alexi Giannoulias claims that Broadway Bank is failing because of the bad economy. “The bank loans aren’t performing because we are in the worst economic recession since the Great Depression and the commercial real estate market crashed by 30 to 40 percent.” (Alexi for Illinois, Press Release, 3/1/2010)

• Giannoulias says Broadway Bank is no different from any other struggling community bank. “Hundreds of community banks that didn’t get a dime of bailout dollars are struggling, and Broadway Bank is no exception.” (Bloomberg, 2/26/2010)

• But the State of Illinois and the FDIC disagree. “The Illinois Department of Financial and Professional Regulation (IDFPR) announced today…the following disciplinary orders in the month of January 2010…Broadway Bank, Chicago – ordered to cease and desist from engaging in unsafe and unsound banking practices.”

• And the New York Times reports Alexi Giannoulias’ “reckless lending” and “hot money” led to Broadway Bank’s collapse. “But here is an inconvenient fact about bank failures: They do not happen overnight. A dollop of reckless lending here, a dash of destabilizing hot money there, hide a few troubles over there. Let that simmer for a while and, voila!, an insolvency soufflé.”

• According to the New York Times, Giannoulias moved the bank into risky construction-related lending practices. “Construction-related lending jumped to more than triple the bank’s required regulatory capital during this period, and the loans started to go bad. By the time Mr. Giannoulias departed, Broadway was left with nearly $14 million in real estate on its books, more than 10 times the level when he arrived. Foreclosures take time, though — often about 18 months. And within two years of Mr. Giannoulias’s departure, the bank was left holding $38 million in real estate.”

• According to the New York Times, Giannoulias made a risky push into brokered deposits. “The move into real estate coincided with a headlong push into brokered deposits. This is quintessential hot money — large amounts that jump from bank to bank, each bank offering the lure of high interest , which the banks then must fund by making ever-riskier loans…During Mr. Giannoulias’s time at the bank, brokered deposits catapulted fourfold, to $640 million. The typical bank at this point was growing brokered deposits at about 9 percent a year.”

• Besides, what kind of community bank based in Chicago approves loans for convicted mobsters in Florida? “FELONS IN FORECLOSURE: Broadway Bank has filed foreclosure cases in Cook County Circuit Court to collect nearly $2.5 million on a 2004 loan to two convicted felons, Michael Giorango, 56, and Demitri Stavropolous, 41, that was secured in part by two Chicago properties. Separately, the Chicago-based bank has filed suit in Miami-Dade County Circuit Court to collect $10.4 million on a 45-rooom South Beach hotel and shuttered restaurant in Hollywood, Fla., which are owned by ventures that include the duo.” (Crain’s Chicago Business, 7/13/2009)

The Chicago Tribune writes that former mob-banker and Democrat Senate hopeful Alexi Giannoulias continues to face serious questions about his embattled family business. As the Tribune notes:

“Still, the situation could become more politically harmful and provide more ammunition for the GOP if the family-owned bank is taken over by the federal government before Election Day… Since 2007, Broadway Bank has filed dozens of foreclosures on various properties, including several to Michael Giorango, a convicted bookmaker and prostitution ring promoter who has become a political albatross in Alexi Giannoulias’ campaigns. During Alexi Giannoulias’ tenure at Broadway, the bank approved loans to Giorango for various real estate deals. Alexi Giannoulias has acknowledged he serviced some Giorango loans and went to Miami to inspect Giorango property the bank financed.”

Meanwhile, Giannoulias’ campaign chairman Senator Dick Durbin admitted that “Giannoulias still needs to answer questions about his family’s bank,” according to Chicago Public Radio.

But Durbin assured voters that Giannoulias is “prepared to answer these questions and it will happen soon.”

The question for Senator Durbin and Alexi Giannoulias is: how soon?

Fridays are getting tense in the Chicago campaign office of Alexi Giannoulias, the Democrat seeking the U.S. Senate seat once held by President Barack Obama. That’s the day regulators announce which troubled banks they’ll close.

Broadway Bank in Chicago, owned by Giannoulias’s family, must attract at least $75 million in capital by late April to meet terms of a consent order with the Federal Deposit Insurance Corp. prompted by losses on commercial real-estate loans. Even if successful, the family could lose control before November’s election, dealing a blow to Democrats and an Obama friend.

Read the full Bloomberg story

In an effort to deflect from his embattled record and ethical issues surrounding his family bank’s ties to the mafia, Illinois Senate candidate Alexi Giannoulias (D-IL) attacked his opponent, U.S. Representative Mark Kirk (R-IL), for opposing a U.S. military option in Iran and falsely claiming Kirk wanted to “let Israel handle it.”

The attack on Kirk – an established pro-Israel champion who engineered the Iran Refined Sanctions Petroleum Act and won the deployment of a U.S. X-Band radar to Israel – was an obvious attempt by Giannoulias to smear his opponent in the Jewish community and claim to be the “more pro-Israel” candidate in the race.

In light of his attack on Kirk, the National Republican Senatorial Committee (NRSC) called on Giannoulias to explain his close family ties and past support for a known anti-Israel foundation in Chicago.

In 2006, Giannoulias served as Vice President and Chief Loan Officer of his family-owned Broadway Bank, where he bragged in a recent interview: “I did everything there.” A closer look at the contributions made by Giannoulias’ family bank to the Crossroad Funds – a left-wing Chicago foundation – reveals a disconcerting trend:

In 2006, records show that Giannoulias’ Broadway Bank contributed between $1,000 and $5,000 to the Crossroad Funds, which provided a $4,000 grant to the Committee for a Just Peace in Israel & Palestine in 2006

In 2007, records show that Broadway Bank elevated to the Crossroads’ “$5,000 & Above” gift level, while the foundation provided another $4,000 to the Committee for a Just Peace in Israel & Palestine.

In 2008, records show Broadway Bank continued its contributions to Crossroads, while the foundation provided another $4,000 to the Committee for a Just Peace in Israel & Palestine.

While 2009 records are not yet available, Crossroads expanded its anti-Israel grants beyond another $3,500 for the Committee for a Just Peace in Israel & Palestine – this time adding another $1,000 for the Electronic Intifada. Moreover, the Giannoulias-backed foundation honored Electronic Intifada at its 2009 annual benefit.

“The Giannoulias family’s support for fringe anti-Israel activity in Chicago is shocking. For supporters of Israel, the Illinois Senate race in November pits Congressman Mark Kirk, who has served as an independent leader and pro-Israel champion, against 33-year-old Alexi Giannoulias, whose family bank boasts strong ties to fringe anti-Israel organizations in Chicago. The contrast in this election could not be more clear,” said NRSC spokeswoman Amber Wilkerson Marchand.

In Illinois, the Chicago Sun Times reports that Republicans are keeping up a steady drumbeat of pressure on Democrat Senate nominee Alexi Giannoulias, who has refused to answer questions about his family’s Broadway Bank. “Why is Alexi hiding?” the party asked in an e-mail to reporters a week after the election and after news conferences Giannoulias had held in Chicago and Springfield. “Put Alexi on the phone,” they repeated Wednesday. In at least 10 e-mails sent out since the election, the party says Giannoulias is ducking questions about loans he authorized four years ago as vice-president of his family’s Broadway Bank and about the bank’s current troubled financial state. They repeat a line he used days before the election to wave off further questions about the bank: “If I’m fortunate enough to make it out of the primary, we can have that conversation.” The Chicago Tribune’s editorial page piggy-backed on the e-mails and said Giannoulias needs to answer more questions about his role at the bank now that he has been fortunate enough to make it out of the primary.

The Chicago Daily Observer takes a trip down Giannoulias’ past and reminds voters that it was Alexi’s bank who loaned millions to a Ukrainian mafia figure.